Large defects of the craniofacial skeleton and extremities occur frequently in our Veterans and may result in functional deficits that require extensive reconstruction. Although autologous bone grafting is the current gold standard for reconstruction of skeletal defects, significant donor sit morbidity including chronic pain, infection, repeated surgeries, and prolonged hospital stays may ensue thus creating a significant need for alternative methods of skeletal replacement. The success of tissue engineering for bone regeneration depends on the optimal interplay of scaffold technology, growth factors, and cellular material in a deliverable fashion. Two barriers to true clinical translation are the variable side effect profiles of exogenous growth factors delivered at high concentrations and the acceptance of laboratory fabricated bone by the host environment. Clinically, supraphysiologic doses of osteogenic growth factors, such as bone morphogenetic protein-2, are utilized as a supplement or replacement for bone grafting procedures. Although bone healing can be accomplished to a certain degree, untoward effects such as soft tissue swelling, ectopic bone formation, resorption of adjacent bone, and long term effects on maxillary growth have all been reported. Our laboratory has previously demonstrated that mesenchymal stem cells can be induced to undergo osteogenesis on three-dimensional scaffolds. Osteogenesis was stimulated regardless of species (mouse, rabbit, or human) or the source of mesenchymal stem cells (bone marrow or adipose). In addition, scaffolds carrying osteogenic cells can be utilized to heal critical sized defects of the rabbit cranial skeleton. However, similr to studies from other investigators, the long term stability of engineered bone after implantation is limited by resorption over time. In this application, we focus on delineating the osteogenic mechanism of a novel, nanoparticulate mineralized collagen glycosaminoglycan scaffolds that imparts efficient osteogenesis of both primary rabbit bone marrow stromal cells and primary human mesenchymal stem cells without additional bone morphogenetic protein stimulation. We propose to investigate the coupling of osteogenesis and osteoclastogenesis in this system with both in vitro and in vivo cranial defect studies.